The deadline is approaching fast for Marylanders to apply for the Student Loan Debt Relief Tax Credit Application.
Borrowers have until September 15, 2023, to submit an application.
Here's what you need to know about the application.
Who is eligible for the tax credit?
Maryland taxpayers who have incurred at least $20,000 in undergraduate and/or graduate student loan debt, and have at least $5,000 in outstanding student loan debt at the time of applying for the tax credit.
Here is how the Maryland High Education Commission chooses who receives the credit:
The criteria for selecting who receives the tax credit are set out in the Code of Maryland Regulations (COMAR).Please note that these regulations are currently in the process of being updated to align with recent changes in the law; the most up-to-date information on the program is on this webpage.
For any taxable year, the total amount of credits approved by MHEC may not exceed $18,000,000. Maryland Higher Education Commission (MHEC) shall prioritize tax credit recipients and dollar amounts based on qualified taxpayers in the following order:
(1) MHEC shall reserve $9,000,000 of the tax credits for the following individuals in the following order of priority:
(a) State employees who graduated from institutions of higher education in the state where at least 40% of the attendees are eligible to receive federal Pell Grants; and
(b) State employees who graduated from institutions of higher education where less than 40% of the attendees are eligible to receive federal Pell Grants;
If the total amount of tax credits applied for by individuals described in (a) and (b) above is less than $9,000,000 for a taxable year, MHEC may make available the unused amount of credits for use by other qualified taxpayers.
(2) Subject to the above, MHEC shall prioritize tax credit recipients and amounts in the following order of priority:
(a) Qualified taxpayers who graduated from institutions of higher education in the State where at least 40% of the attendees are eligible to receive federal Pell grants; and
(b) Qualified taxpayers who graduated from institutions where less than 40% of the attendees are eligible to receive federal Pell Grants, who may be prioritized by one or more of the following categories:
• Did not receive a tax credit in a prior year
• Graduated from an institution of higher education located in the state
• Were eligible for in–state tuition
• Have higher debt burden to income ratios
To apply for the credit, click here
